In this paper, we investigate joint optimal relay selection and resource allocation under bandwidth exchange (BE) enabled incentivized cooperative forwarding in wireless networks. We consider an autonomous network where N nodes transmit data in the uplink to an access point (AP) / base station (BS). We consider the scenario where each node gets an initial amount (equal, optimal based on direct path or arbitrary) of bandwidth, and uses this bandwidth as a flexible incentive for two hop relaying. We focus on α-fair network utility maximization (NUM) and outage reduction in this environment. Our contribution is two-fold. First, we propose an incentivized forwarding based resource allocation algorithm which maximizes the global utility while preserving the initial utility of each cooperative node. Second, defining the link weight of each relay pair as the utility gain due to cooperation (over noncooperation), we show that the optimal relay selection in α-fair NUM reduces to the maximum weighted matching (MWM) problem in a non-bipartite graph. Numerical results show that the proposed algorithms provide 20-25% gain in spectral efficiency and 90-98% reduction in outage probability.